The road to improvement
In sports, the level of play continues to improve and records continue to be broken as teams and individuals try new equipment, technology and training techniques. Similarly, many city and county fleet managers are constantly testing, identifying and applying new approaches to managing their equipment and people. However, unlike those in the sports world, where ways to improve are readily discussed and disseminated, local government fleet managers have to work hard to be exposed to the new ideas and practices that can make their fleets operate more smoothly.
Solutions to fleet management problems that may help others tend to either remain in a knowledge base that never strays far from where the problem is solved or take too long to become known and accepted. For example, it took years for improvements such as automatic brake slack adjusters, tubeless tires and automated management information systems to be adopted by the trucking industry.
To become more efficient, many local government operations are required to compete with private fleet management companies. The intent is to give their internal fleet operations an incentive to identify ways to be as competitive in delivering service as the private fleet management companies and, ultimately, to allow competition to determine which sector provides the most cost-effective solution.
Private companies have two disadvantages when competing with cities and counties. First, they often pay taxes and, second, they must earn a profit. Those two factors mean that private companies must deliver fleet maintenance services more efficiently to be competitive with local governments. Consequently, more governmental operations are turning over their fleet maintenance services to private companies. How are private contractors able to perform more efficiently and maintain a profit?
Private companies’ secrets
The private companies’ major advantage over public sector operations is their ability to drive down costs by using best practices identified at several locations. Specifically, they benchmark performance to identify the locations delivering superior work. Then, they replicate those practices across the entire organization using training and standardized policies and procedures. To protect their competitive advantage, private companies do not reveal their best practices to other private competitors or to their clients.
Many city and county fleet managers have found they can reduce costs by contracting selected functions instead of the entire operation. Chris Amos, commissioner of equipment services for St. Louis, says his city “is in dire financial straights [and] is looking for cost-cutting opportunities that will permit us to continue to provide core support functions during a time of reduced budgets, more expensive parts and older vehicles.”
While Amos believes in outsourcing when vendors can perform the work less expensively, “I never seriously considered outsourcing something as critical as preventive maintenance (PM) until recently,” he says. However, the need to further cut costs led him to outsource the “A” list of PMs on his light duty vehicles. While the overall impact of the contractor’s performance is being closely scrutinized, Amos reports that he has reduced the costs of a PM by about one-third compared to performing the work in-house, and he has improved vehicle turnaround at the same time.
While private companies work hard to guard their best practices, cities and counties have no such constraints and, in fact, have reasons to work together. In short, governmental fleet management operations should be able to outperform private providers if they can identify and capitalize their best practices through improved information sharing.
Ways to share information
City and county fleet managers can network and share best practices even if their methods are not as formal as the processes used by private fleet companies to share information within their departments. Professional publications and training seminars are two ways to learn best practices, but professional fleet management organizations provide one of the most effective ways to network and learn.
The primary purpose of most of the organizations is to promote professional vehicle management and maintenance skills and enable members to improve their performance and the performance of their fleets. They accomplish that goal through seminars, publications and the electronic exchange of information. However, they often serve as facilitators of networking groups. While fleet managers may be introduced to peers at local chapter meetings, regional meetings, annual conferences or national trade shows, the forums allow managers routinely to share fleet problems and expertise with peers.
The National Association of Fleet Administrators (NAFA), based in Iselin, N.J., is one of the larger fleet management organizations. NAFA members include fleet administrators for government agencies (local, state and federal), public service entities (law enforcement, educational institutions and utilities), financial institutions, insurance companies and non-profit fleet organizations. Several other professional organizations focus on a specific area of fleet operations and/or on a narrower geographic base. Those include the Livermore, Calif.-based Public Fleet Supervisors Association, the Litchfield Park, Ariz.-based Rocky Mountain Fleet Management Association, the California County Fleet Managers Association and the Rocklin, Calif.-based Public Equipment Managers Association.
Because of information he received while networking with another fleet manager, John McCorkhill, the director of fleet services for Lynchburg, Va., changed the way he sold used equipment. “After trying various approaches for getting more on the sale of used equipment, I experimented with using an Internet auction approach,” McCorkhill says. “I have significantly expanded my market of potential buyers and increased what I was getting for my rolling stock by [between] 20 percent and 100 percent, especially for heavy duty and specialized equipment.”
Peer review teams
Joining a peer review team and visiting similar fleet operations is another effective way to identify best practices and to understand how individual fleets are performing. The process usually consists of several fleet managers who visit their peers’ operations. The team observes procedures, staffing, performance and other operational areas. At the conclusion, the team reports general findings and, if appropriate, recommendations for improvements. The advantages of a peer review team are that each member receives an objective review of their operation and sees first hand the performance of other operations.
In 2002, the Central Ohio Transit Authority (COTA) arranged to have a team of industry managers from other transit authorities visit and review their operations. “I especially liked the process since I had the opportunity to work with other fleet managers and specifically request that they pay attention to some parts of my fleet maintenance operation which I felt could use a fresh set of eyes,” says Steve Yuszka, the agency’s director of vehicle maintenance.
In addition to suggesting various ways to improve operations, the peer review also helped further some existing initiatives by recognizing their potential. “Besides supporting some pending staffing modifications, the peer group also helped by encouraging us to move ahead with an initiative to purchase reconditioned electrical units such as starters, alternators, evaporator motors, condenser motors, etc., instead of rebuilding them ourselves,” Yuszka says. “Not only did this save us money in parts and labor costs, but we also get warranty on the reconditioned items.”
The peer review process has drawbacks, however. Managers are taken away from their responsibilities as they travel, and, if the process is handled unprofessionally, people can become defensive as the event degenerates into a tit-for-tat exercise. Participants also may avoid being critical for fear of being similarly criticized. It usually takes a dispassionate manager to organize, orchestrate and manage the process for maximum effectiveness.
Outside resources
Consultants also can be independent observers of fleet operations to identify problems and help establish best practices. For example, in one case, a consultant observed a specialized team that, when they repaired axle spindles, replaced the failed spindles without removing the axle. Although the process was thought to save both time and money over a full axle replacement, after inquiring into the frequency of spindle failures, the consultant was convinced the number of repairs was excessive based on the experience of similar fleets.
The consultant also observed that, while performing a quick-change brake reline, the maintenance team was pairing mismatched bearings and races. The repair records also identified a direct correlation between the start of the quick-change break reline process and the beginning of the axle failure problem. Discontinuing the old break reline process resulted in a dramatic decline in axle failures.
Continuous improvement is a challenge that none can neglect. While copying is the most sincere form of flattery, in today’s rapidly changing world of fleet management, it also is a competitive advantage that cannot be overlooked.
The author is a Cincinnati-based fleet management consultant.